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Alibaba earnings top expectations as pandemic drives increased digital purchases

Alibaba Group Holding Ltd.
BABA,
+0.53%

topped earnings and revenue estimates Thursday for its fiscal first quarter, and its shares were up 0.5% in premarket trading. The company reported net income of RMB47.59 billion ($6.74 billion), or RMB17.36 a share, up from RMB21.26 billion, or RMB8.06 a share, in the year-earlier quarter. Alibaba reported adjusted earnings per American depositary share of RMB14.82, up from RMB12.55 a year earlier and ahead of the FactSet consensus, which called for RMB13.82. Alibaba’s revenue for the June quarter rose to RMB153.75 billion from RMB114.92 billion a year prior and came in above the FactSet consensus of RMB148 billion. “We were well positioned to capture growth from the ongoing digital transformation, which has been accelerated by the pandemic, in both consumption and enterprise operations,” Chief Executive Daniel Zhang said in a release. Alibaba had 742 million annual active customers on its China retail marketplaces as of the June quarter, up 16 million from the March period. The company disclosed that gross merchandise volume for online physical goods on its Tmall marketplace grew 27% in the June quarter, “with all major categories growing at similar or faster rates compared to the December 2019 quarter, before the onset of the COVID-19 pandemic.” Alibaba said that Tmall was benefitting from both greater order frequency and an influx of new customers. Alibaba shares have gained 20% over the past three months as the S&P 500
SPX,
-0.44%

has risen 14% and as the KraneShares CSI China Internet ETF
KWEB,
-1.34%

has added 29%.

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